OMVIC Contracts and Consumer Rights Flashcards

A consumer purchases a used vehicle and takes delivery. Three months later, she discovers the dealer knew the vehicle had been used as a daily rental but never disclosed it. Under the MVDA, what is the consumer's most appropriate remedy specific to this non-disclosure?

Answer: She may rescind the contract within 90 days of discovering the non-disclosure, as undisclosed rental history is a statutory material fact

Under Ontario's MVDA and its regulations, undisclosed prior daily-rental use is a prescribed material fact. When a dealer fails to disclose a material fact, the consumer has the right to rescind the contract within 90 days of discovering the non-disclosure — not from the date of sale. There is no general cooling-off period for vehicle purchases in Ontario; this rescission right is tied specifically to material fact non-disclosure.

A dealer's advertisement lists a vehicle at $24,999 'all-in.' The buyer arrives and is told the price excludes a $499 'dealer documentation fee' and a $300 'VIN etching fee.' Which of the following is accurate under OMVIC's all-in pricing rules?

Answer: Both charges violate all-in pricing — all dealer-imposed fees must be included in the advertised price

OMVIC's all-in pricing requirement mandates that ALL fees a dealer charges — including documentation fees, admin fees, and any add-on services the dealer applies by default — must be included in the advertised price. Only HST and government licensing/registration fees may be added separately. Neither documentation fees nor VIN etching fees are government charges, so neither may be added to a clearly stated all-in price.

A buyer signs a purchase contract conditional on financing. The dealer fails to arrange financing within the agreed period but continues holding the buyer's $2,000 deposit. Under OMVIC regulations, what obligation does the dealer have once it is clear financing cannot be arranged?

Answer: The dealer must return the full deposit promptly, as the condition precedent failed and the contract is void

When a purchase contract is conditional on financing and that condition cannot be fulfilled, the contract fails and the dealer has no legal basis to retain the deposit. OMVIC regulations and the MVDA require the dealer to return the full deposit promptly. Retaining a 'restocking fee' from a failed conditional contract is not permitted, and an 'as-is' clause relates to vehicle condition, not to deposit forfeiture on a failed condition precedent.

During contract preparation, a salesperson realizes the vehicle was previously registered in the United States and had its odometer converted from miles to kilometres, but the odometer display now shows kilometres without any indicator of the conversion. Which disclosure obligation applies?

Answer: The dealer must disclose the odometer conversion in writing on the contract, as odometer inaccuracy or alteration is a prescribed material fact

An odometer that has been altered, converted, or is otherwise not a direct reflection of original kilometres driven must be disclosed as a material fact under the MVDA. A miles-to-kilometres conversion that leaves no visible indicator on the odometer represents an inaccuracy in display context. The obligation is proactive — dealers cannot wait for the consumer to ask. Mathematical accuracy of the conversion does not eliminate the disclosure requirement.

A consumer's trade-in vehicle is listed at $8,500 on the purchase contract. Before the deal closes, the dealer discovers an undisclosed lien of $3,200 on the trade-in. The dealer adjusts the trade-in allowance to $5,300 without notifying the buyer and presents a revised contract. What is the dealer's correct obligation under OMVIC rules?

Answer: The dealer must disclose the lien discovery and the adjusted trade-in figure to the consumer before the consumer is asked to sign the revised contract

Material changes to contract terms — including adjustments to the trade-in allowance — cannot be made unilaterally without transparent disclosure to the consumer. The consumer must be clearly informed of the lien discovery and the resulting adjustment before signing any revised agreement. While the consumer's non-disclosure of the lien may have legal consequences, the dealer's remedy is not to silently revise contract terms; the buyer retains the right to make an informed decision on the revised terms.

A registered salesperson leaves a dealership and joins a competing dealer the following week. A customer she was working with at the old dealership contacts her directly to complete the vehicle purchase she had started. The salesperson offers to finalize the deal through her new employer's dealership. Which statement best reflects the regulatory position?

Answer: The salesperson may assist the customer through her new dealer, but the transaction must be conducted entirely through the new registered dealer with full disclosure of the transfer of dealerships

OMVIC registration is tied to a specific dealer — a salesperson may only conduct registerable activity on behalf of the dealer they are currently registered with. Once registered with the new dealer, the salesperson can legitimately assist the customer through that new dealership, but the transaction must be a genuine new transaction under the new dealer's licence with full transparency. There is no regulatory 30-day non-solicitation period under the MVDA, and acting independently or on behalf of a former dealer without registration is prohibited.